The Door is Open for Class Action Lawsuits against Manufacturers

law and money

Recent federal court decisions relaxing the standards for class action certification must have plaintiff class action lawyers around the country celebrating. It now seems that a mere handful of customer complaints can support a class action lawsuit on any consumer product. What should manufacturers do to address this development and resulting increase in liability exposure? Should they spend more money up front to resolve warranty claims, before they end up in suit? Or, should they fight it out in court and hope to curtail the recent trend? Either way, we suspect manufacturers’ costs are going up. Continue reading

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by | October 14, 2014 · 10:24 am

Read the warranty before crying foul

Suitcase

A recent LA Times piece unfairly accuses luggage maker Victorinox of not living up to its lifetime warranty. But if the article’s author, or the aggrieved customer had only bothered to read the warranty, they’d have found that the company did “no such thing.” Continue reading

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Filed under Customer Experience, Warranty

Putting the customer first drives sales … at least KIA Australia thinks so

Kia AU 777

Competition benefits consumers far more than so-called consumer protection laws and the red-tape they’re wrapped in. The former delivers better quality and service and a lower price, while the latter needlessly drives up costs on both sides of the transaction and keeps seedy lawyers in business. Want proof? Look at what Kia is doing in Australia, and why. Continue reading

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Filed under Customer Experience, PR & Branding

Plain language to the rescue?

Knights in shining armour

Imagine if you will, you are the founder and CEO of ABC, Co., a small to midsize company that’s been sued for millions of dollars in a breach of contract action. Next imagine that, just before sending the jury out to deliberate, you heard the judge say to them:  “It is up to you to decide what ABC, Co.’s obligations were under the contract.”  Feeling queasy? Well, here’s the kicker:  your company wrote the contract.

Recently, a scenario just like this one played itself out in a Chicago courtroom. How’d it turn out, you ask? Read on. Continue reading

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Filed under Best Practices, Court Decisions

Groundhog Day: Another piece questioning the value of extended warranties

Celtic-knot-basic-linear

The same article keeps popping up every other week or so in one publication or another. Its headline either asks if extended warranties are worth the cost or screams they are not. It gives the same advice – “buy smart” – and generally reaches the same conclusion on whether you should buy a service contract – “It depends”. See here, then here, here, herehere, and here.  Why is somebody always picking on extended warranties?

Here are 5 reasons why I think extended warranties make an easy target. Continue reading

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Filed under Customer Experience, PR & Branding, Service Contract, Warranty

Consumer Reports to consumers: Choose risk or over peace of mind

boxing clip artIn a September 6 piece, Why you should avoid home warranties, Consumer Reports again takes a shot at service contracts. Noting a recent complaint filed by New Jersey regulators against Choice Home Warranty for allegedly making it difficult to obtain benefits, CR “recommend[s] avoiding service contracts” because those “that cover homes and cars, for example, can cost hundreds of dollars.” But what if the car or home costs many thousands of dollars? Isn’t spending a few hundred bucks on a service contract worth it to minimize risk and secure peace of mind? “No,” says CR, “it makes much more sense to buy reliable products and maintain them as the manufacturer recommends.” Now it’s clear, just buy things that won’t malfunction or fail. Continue reading

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Filed under Customer Experience, Resolving Disputes, Risk Management, Service Contract, Warranty

Odds and ends in the world of warranty

notes Some interesting notes about the goings on in the warranty business. Continue reading

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Case Note: Court puts the brakes on implied warranty claims

brake rotor

“Merchantability” is one of those legal terms-of-art that defies precise definition. Courts ruling on implied warranty of merchantability claims generally frame the question as whether the product was “reasonably fit for its intended purpose.” But what any given jury will find to be “reasonable” is anyone’s guess. So better for the defendant that the case never get to the jury. I think Chrysler might agree. Continue reading

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Filed under Court Decisions, Resolving Disputes, Statutes & Regulations, Warranty

Mary, you’re being quite contrary

see sazw

In her recent column, Everyday Cheapskate Mary Hunt begins by taking a swipe at extended warranties: “While I cannot say that every extended warranty would be a rip off, that’s the way I want you to start thinking of them.” But she concludes her piece by noting that, “On a personal note, there are only two products for which I have and will continue to buy the extended warranty: Apple products … and treadmills.” Confusing? Well not really. Continue reading

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Filed under Customer Experience, Service Contract

Tesla: Investing in warranty is “doing the right thing.”

Tesla logo

“Doing the right thing” might reduce electric car maker Tesla Motors’ earnings short-term, “but will work out well in the long term,” writes CEO Elon Musk on the company’s blog. In today’s marketplace, I think he’s on the money. What do you think? Continue reading

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Filed under Best Practices, Customer Experience, PR & Branding, Service Contract, Statutes & Regulations, Warranty